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Postmodern Government Budgets


If President Bush’s bureaucracy were as capable as the bureaucracy in George Orwell’s great novel, Nineteen Eighty-Four, Lawrence Lindsey, the president’s former economic advisor, would have been airbrushed out of every photograph he appeared in while holding that post, and every reference to his estimate of the cost of the coming Iraq war would be wiped from every archive in the country. Today no one would know who Lawrence Lindsey is or that he once said that the war would cost $100 billion to $200 billion.

Alas, government is not quite as powerful as Orwell envisioned. So the Bush administration has to settle for simply firing Lindsey (or insisting he resign) and having the budget director dismiss and discredit Lindsey’s estimate and issue his own lower one.

Maybe that more transparent method will work just as well. After all, while $100 billion to $200 billion may strike some as a mite expensive for a war against a weak and toothless dictator, $50 billion to $60 billion is an absolute steal. It’s the Kmart blue-light special on wars. We can’t afford not to go to war.

Still, one has to chuckle at the way the administration has pulled this off. It’s not as far from Orwell as it looks at first sight. Through Orwellian “doublethink” people knew the past had been changed—they just didn’t acknowledge to themselves that they knew. Through Bushian “doublethink,” we all know that the economist whom Bush respected enough to make his chief economic advisor estimated an exorbitant cost for the war—but now we tell ourselves that he was wrong and had to go.

Did Budget Director Mitch Daniels, who presented the new, lower estimate, explain why his number is better than nonperson Lindsey’s? According to the New York Times, “Mr. Daniels declined to explain how budget officials had reached the $50 billion to $60 billion range for war costs, or why it was less in current dollars than the 43-day gulf war in 1991.”

In other words, trust us. Daniels’s estimate must be better than the nonperson Lindsey’s because … well, because Lindsey is a nonperson. Here’s how Daniels put it: “That wasn’t a budget estimate. It was more of a historical benchmark than any analysis of what a conflict today might entail.” My best translation of that is: Lindsey was delirious when he talked about the cost of war.

There were other comforting aspects of post-Lindsey cost estimating. The money for the war won’t upset the 2004 budget, and it won’t be part of the 2003 $355 billion military budget (a record figure). Rather, it will be appropriated by Congress as an emergency expenditure. I sometimes wonder why the whole budget isn’t just labeled “emergency expenditure” so we can be done with all our fiscal problems.

Only a curmudgeonly taxpaying tightwad would point out that the long-suffering productive classes will cough up the money no matter what the government calls it.

The intellectual world a few years ago moved into what is called the postmodernist phase. That’s more or less the view that reality has no firm identity and that it is available for molding according to personal, class, or cultural interests. Thus we are told that even “male” and “female” are merely social constructs or conventions.

But the intellectuals have nothing on the politicians and bureaucrats. Government has been in a postmodernist phase for many decades. This is most clear when it writes its budgets. Revenue and spending figures have one objective: to sell the program. When the medical socializers wanted to get Medicare passed, they issued cost estimates that we now know were ludicrous. According to Medicare historian Sue Blevins, in 1965 the government said the hospital part of the program would cost $9 billion in 1990. What it really cost was $66 billion. Adjusted for inflation, the estimate was off by 165 percent. Not bad for government work.

The point is, the government budget is not an honest estimate of uncertain future costs. It’s a political document designed to advance an agenda. It is inherently dishonest.

Anyone want to bet on whether Lindsey or Daniels has the better estimate on the cost of the war?

Sheldon Richman is senior fellow at The Future of Freedom Foundation in Fairfax, Va., and editor of Ideas on Liberty magazine.

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    Sheldon Richman is former vice president and editor at The Future of Freedom Foundation and editor of FFF's monthly journal, Future of Freedom. For 15 years he was editor of The Freeman, published by the Foundation for Economic Education in Irvington, New York. He is the author of FFF's award-winning book Separating School & State: How to Liberate America's Families; Your Money or Your Life: Why We Must Abolish the Income Tax; and Tethered Citizens: Time to Repeal the Welfare State. Calling for the abolition, not the reform, of public schooling. Separating School & State has become a landmark book in both libertarian and educational circles. In his column in the Financial Times, Michael Prowse wrote: "I recommend a subversive tract, Separating School & State by Sheldon Richman of the Cato Institute, a Washington think tank... . I also think that Mr. Richman is right to fear that state education undermines personal responsibility..." Sheldon's articles on economic policy, education, civil liberties, American history, foreign policy, and the Middle East have appeared in the Washington Post, Wall Street Journal, American Scholar, Chicago Tribune, USA Today, Washington Times, The American Conservative, Insight, Cato Policy Report, Journal of Economic Development, The Freeman, The World & I, Reason, Washington Report on Middle East Affairs, Middle East Policy, Liberty magazine, and other publications. He is a contributor to the The Concise Encyclopedia of Economics. A former newspaper reporter and senior editor at the Cato Institute and the Institute for Humane Studies, Sheldon is a graduate of Temple University in Philadelphia. He blogs at Free Association. Send him e-mail.